Higher One Holdings, the leading provider of campus debit cards on American campuses, faces an investigation by the Federal Reserve Bank of Chicago in connection with the practices of a former bank partner involving college students’ accounts.

The new probe follows an investigation of Higher One by the Federal Deposit Insurance Corporation, which accused the company of violating college students’ consumer rights. That inquiry ended in 2012 with an $11 million settlement.

Higher One, once a Wall Street darling, is dealing with a growing list of regulatory headaches as it battles accusations that its practices siphon away hefty portions of students’ federal loans.

The Chicago Fed investigation was disclosed last month by Higher One in its annual report filed with the Securities and Exchange Commission. The filing referred to a former bank partner that falls under the regulatory purview of the Chicago Fed, but the bank was not identified. According to Higher One, the former partner may be accused of “unfair or deceptive practices,” a violation of the Federal Trade Commission Act, over marketing and disclosure efforts related to Higher One’s campus debit card accounts.

Of all the bank partners Higher One has disclosed in its securities filings, Cole Taylor Bank is the only one that is also regulated by the Chicago Fed. Moreover, in its own annual report, also filed with the SEC in March, Cole Taylor’s parent company, Taylor Capital Group, similarly referred to an investigation by bank regulators in relation to a former partner, described as “an organization that provides electronic financial disbursements and payment services to the higher education industry.”

…The Chicago Fed’s investigation could lead to civil monetary penalties and restitution, as well as changes to certain business practices of Higher One. Such an inquiry “could have a material adverse effect on our business, financial condition and results of operations,” Higher One wrote. Taylor Capital Group told investors that it could be forced to give refunds to allegedly harmed customers, though it added that Higher One would pick up the tab.

The disclosure of this latest investigation comes just as Higher One is negotiating with the U.S. Department of Education over new regulations on campus debit cards that threaten to curb the company’s revenues. Other negotiators convened by the Education Department have already been critical of Higher One. A new probe of allegations the company cheated college students could undermine Higher One’s arguments with Education Department rule writers.